Story perspectives

Waller Backs Holding Rates if August Inflation Cools

9/4/2026

Summary

Waller Backs Hold

Fed Governor Christopher Waller said he will support holding rates at the September 15-16 meeting if August inflation eases.
The August consumer price index, to be released on Sept. 11, will largely determine Waller’s vote.
Traders cut the probability of a September rate hike to about 50%, down from roughly 65% after his remarks.
Waller noted 12-month core PCE inflation remains at 3.3%.

Summary

Wall Street Rallies

Wall Street indexes closed over 1% higher, led by the Nasdaq.
The S&P 500 rose 81.67 points to 7,748.27, and the Dow gained 627.37 points to 53,689.32.
Nvidia jumped 1.8% after announcing a $12.9 billion purchase of Hugging Face.
Snowflake surged 16.6% after forecasting strong annual revenue, boosting software sector sentiment.
Crypto-linked stocks rose as bitcoin recovered, with Strategy up 17.6% and Robinhood up 16.6%.

History

Historical Context

In October 1981, Federal Reserve Chairman Paul Volcker raised the federal funds rate to 20%, triggering a severe recession but curbing inflation. The policy shift forced banks like Citibank and investment firms such as Goldman Sachs to tighten credit, shrinking loan growth by 4% in 1982. Today's market mirrors that dynamic as Fed Governor Christopher Waller’s stance and Nvidia’s $12.9 billion Hugging Face deal sway the S&P 500, Nasdaq, and crypto-linked stocks. The 1981 episode shows aggressive rate decisions can reshape equity valuations, suggesting that persistent inflation pressures may again drive volatile market corrections.

1 of 3

Waller Backs Hold

Fed Governor Christopher Waller said he will support holding rates at the September 15-16 meeting if August inflation eases.
The August consumer price index, to be released on Sept. 11, will largely determine Waller’s vote.
Traders cut the probability of a September rate hike to about 50%, down from roughly 65% after his remarks.
Waller noted 12-month core PCE inflation remains at 3.3%.

1 / 3